You’ve probably heard of the ERM-14 form, but do you know why and when to use it?
The ERM-14 form is generally used to report changes in ownership resulting from sales, mergers and other events.
Why the ERM-14 form is important
There are a couple of reasons why filling out the form promptly is so important, including:
- It ensures that the state can provide accurate proof of workers’ compensation coverage
- It provides the state data collection organization information needed to determine combinability of multiple entities
Proof of coverage: When we issue a workers’ compensation policy, we send the information to the state’s data collection organization, and they give the policyholder information to the state for proof of coverage reporting. If the employer’s name or entity type changes, the proof of insurance coverage might not get reported accurately. As a result, the employer may receive a letter from the state asking for proof of coverage. Filling out the ERM-14 form to provide proper notification of a name or entity type change can help avoid confusion.
Combinability: Entities that share majority ownership can share one workers’ compensation policy and e-mod. When a business goes through a change that impacts the ownership structure, this can affect whether it’s combinable. The state data collection organization makes this determination based on the information provided on the ERM-14 form.
When to submit an ERM-14 form
Complete an ERM-14 form in the event of a:
- Name and/or legal entity change
- Sale, merger, acquisition, or transfer of assets
- Successor entity being formed to operate alongside of an existing business, or to take over the operations
You should submit an ERM-14 form if one of the above changes has occurred regardless of whether the employer is experience rated. If you need a copy of the form, visit the agents section of sfmic.com.